Opinion
Index No. 350050/1999
11-26-2024
M.J.K., Plaintiff, v. A.L.K., Defendant.
Counsel for Plaintiff: Chemtob Moss Forman & Beyda LLP Natalie Switzer Maier, Esq. Counsel for Defendant: Samuelson Hause PLLC Michael J. Angelo, Esq.
Unpublished Opinion
Counsel for Plaintiff: Chemtob Moss Forman & Beyda LLP Natalie Switzer Maier, Esq.
Counsel for Defendant: Samuelson Hause PLLC Michael J. Angelo, Esq.
Ariel D. Chesler, J.
The following e-filed documents, listed by NYSCEF document number (Motion 003) 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39, 40, 41, 42, 43, 44, 45, 46, 47, 48, 49, 50, 51, 52, 53, 54, 55, 56, 60, 61 were read on this motion to/for MAINTENANCE (ALIMONY & SUPPORT).
Upon the foregoing documents, it is
Plaintiff moved by Order to Show Cause for an Order terminating Plaintiff's nondurational spousal maintenance obligation in the amount of $10,000 per month to Defendant. In the alternative, Plaintiff moved for a downward modification of the maintenance obligation. Defendant cross-moves to summarily deny Plaintiff's motion, sanction Plaintiff for frivolous conduct and for counsel fees and disbursements in connection with this motion. Plaintiff and Defendant have each submitted a Sur-Reply which both contained affidavits from non-parties which will not be taken into consideration in this Court's determination of the present motion.
BACKGROUND
This is a post judgment matrimonial action. The Parties were married in June 1984 and the Judgment of Divorce was entered in May 2000. The Parties entered into a Stipulation of Settlement (the "Agreement") dated May 4, 2000, wherein Plaintiff is to pay Defendant the sum of $10,000 per month as and for nondurational maintenance. Plaintiff also paid additional maintenance to the Defendant in the form of a one-time payment of $76,204 at the time of the Agreement.
DISCUSSION
Plaintiff argues that Defendant's receipt of maintenance since 2000, which has exceeded the length of the marriage by eight years, has now made her a multi-millionaire which warrants an end to lifetime maintenance. Plaintiff also argues that in addition to all the maintenance paid, Defendant received almost $2,000,000 in equitable distribution made up of two residences in Great Neck and Paris, marital assets, retirement assets and additional support pursuant to the Agreement. Plaintiff further asserts that Defendant has a multimillion-dollar inheritance and since the Agreement, Defendant has now started to receive social security in the amount of approximately $2,500 per month. Plaintiff also claims he has been unable to secure a new job and it is an extreme hardship for him to continue paying maintenance which warrants a modification of the Agreement.
Plaintiff states that on July 30, 2018, he involuntarily retired from his Job and was forced to accept a severance package but continued as a consultant until December 31, 2018. Plaintiff also claims he could not work until the summer of 2020 due to an 18 month non-compete provision in his Severance Agreement. Plaintiff then formed an LLC and pursued his own investment company. Then in 2022 Plaintiff began searching for employment and has not found employment to date after applying to over 50 positions.
Defendant insists Plaintiff has grossly understated his financial circumstances and not disclose all of his assets to the Court thus failing to establish he has suffered any hardship from his alleged change in circumstance. Defendant claims that Plaintiff failed to include assets and investments in companies on his Statement of Net Worth. Defendant also denies Plaintiff's allegations regarding the Agreement, claiming that she only received a total of $1,137,708 as equitable distribution pursuant to the Agreement.
Termination/Downward Modification
It is well established that the party moving to modify an order or judgment incorporating the terms of a stipulation regarding spousal maintenance bears the burden of establishing that the continued enforcement of his maintenance obligation would create an extreme hardship (Dom. Rel. Law § 236(B)(9)(b)(1); see Sheila C. v Donald C., 5 A.D.3d 123, 123-124 [1st Dept 2004]). Further, "Marital settlement agreements are judicially favored and are not to be easily set aside" (Simkin v Blank, 19 N.Y.3d 46, 52 [2012]).
In Z.U. v. F.U., 77 Misc.3d 1234 (A) [Sup, Ct 2023] aff'd NY Slip Op. 05079 [1st Dept 2024], the Court stated, "although the equities seem to dictate outright termination of the support obligation, the Court is unaware of authorities permitting the same where the parties have contracted for lifetime maintenance, and without other circumstances not present here such as a permanent disability." In Z.U. v. F.U, the Court found Plaintiff experienced extreme hardship and was permanently limited in his career and ability to gain employment at his desired level and had no savings, or assets in his name. Yet, the Court still denied termination of lifetime maintenance.
Here, Plaintiff has established that he lost his employment involuntarily in 2018. However, while Plaintiff has demonstrated that he has made significant efforts to find new employment, these efforts were made in 2022, two years after Plaintiff's non-compete clause with his previous employer ended. Plaintiff chose to start his own business, instead of applying to positions commensurate with his qualification and experience knowing he had this support obligation. Indeed, Plaintiff did not establish that he could never again find employment. Additionally, Plaintiff provided an Amended Statement of Net Worth showing a number of assets owned, albeit some partially owned, by Plaintiff. The Court therefore denies Plaintiff's request for termination of lifetime maintenance.
In Palmer v. Spadone-Palmer (190 A.D.3d 495 [1st Dept 2021]), the First Department affirmed the termination of the husband's maintenance obligation, finding that the husband was entitled to an extreme hardship determination where his overall financial situation had "considerably worsened from where it had been at the time of the settlement agreement" and that such adversity was not voluntary. In Kaplan v. Kaplan (130 A.D.3d 576, 577 [2d Dept 2015]) the Court granted a downward modification of the maintenance obligation where "the plaintiff demonstrated that his loss of employment was unavoidable, that he made a good-faith effort to obtain employment commensurate with his qualifications and experience, and that continued enforcement of the maintenance obligation as set forth in the parties' separation agreement would create an 'extreme hardship.'"
Demonstrating "extreme hardship" is a high burden. Especially where in some circumstances while no extreme hardship may be present the equities would indicate that a modification may in fact be warranted. In this Court's view, the issue of lifetime maintenance is one that should be reviewed by the Legislature and perhaps modified to allow the Judiciary to have more discretion when entertaining termination or modification requests. In the meantime, this Court is required to follow the law as it exists today.
It seems important to note that Plaintiff's financial condition would also be less of a concern had he sought equivalent employment immediately once his non-compete clause terminated. Plaintiff's argument that Defendant's financial status has drastically improved due to the terms of the Settlement Agreement is not a factor when considering whether the maintenance obligation would create an extreme hardship on the Plaintiff. The Court finds Plaintiff's additional arguments about his overall expenses including but not limited to his voluntary financial obligations to his new family, standard federal, local and state taxes, mortgage payments, college expenses and number of bad investments unavailing. The Defendant's finances and what she stood to gain from the Agreement were known and contemplated at the time the Parties entered into the Agreement. Additionally, working in the investment field for many years Plaintiff is aware that the market can be volatile and not all investments will be fruitful. Plaintiff failed to include in his papers a copy of his severance package which could shed light on how long he was compensated and whether he was given any stock options as part of his payout. The Plaintiff also has multiple assets listed on his Statement of Net Worth which he could sell to generate liquid assets. The Court therefore finds that the Plaintiff has failed to establish extreme hardship required for modification of his maintenance obligation.
Sanctions
Defendant claims there is no basis for Plaintiff to request a modification of his maintenance obligations and that the motion is frivolous and sanctionable pursuant to 22 NYCRR 130-1. 1a. Defendant further argues that Plaintiff should be punished for producing a fraudulent and deceitful Statement of Net Worth to the Court which was missing a number of assets including real estate properties and investments. Plaintiff argues that prior to Defendant's opposition papers being due, he submitted an Amended Statement of Net Worth with the assets in question.
Defendant relies on Rengifo v. City of New York (7 A.D.3d 773, 776 [2nd Dept 2024]), where the Court found that movants may not remedy any deficiencies in their moving papers by amending them in reply papers. Here, the Plaintiff did eventually amend the Statement of Net Worth before the opposition papers were due. Nevertheless, Defendant did have an additional reply in which she was able to fully review the Amended Statement of Net Worth and respond, which she did. Given that this is the first request for a downward modification since the Parties entered into the Agreement in 2000, almost 24 years ago, the Court does not find Plaintiff's motion and positions wholly frivolous to warrant sanctions. At this time the Court will issue a warning rather than impose sanctions. However, if further steps are taken or a similar motion is filed on the same basis Plaintiff may be subject to sanctions in the future. Therefore, parties shall be responsible for their own legal fees.
CONLCUISION
Accordingly, it is
ORDERED, Plaintiff's application for a termination of the nondurational spousal support obligation is denied; and it is further
ORDERED, Plaintiff's application for a downward modification of his spousal support obligation is denied; and it is further
ORDERED, that both parties are responsible for their own legal fees; and it is further
ORDERED, all other relief sought is herein denied; and it is further
ORDERED, the cross-motion is denied.
This constitutes the Decision and Order of the Court.